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Uganda’s development partners including Norway, Sweden, the Republic of Ireland and Denmark last October took the decision to freeze aid transfers after a forensic audit by the Auditor General unearthed evidence of financial scam at the OPM.

At least 60bn shillings meant for recovery and development activities in northern Uganda and Karamoja was reportedly swindled, prompting the angry donors to demand for a refund of their stolen cash.

Now government is reported to have returned 21 billion shillings to the Swedish government that was swindled from the Office of the Prime Minister, without the approval of parliament.

Speaking to KFM, renowned economist Professor Augustus Nuwagaba said the move is likely to weaken the shilling even further against the dollar.

He explains that this could lead to an increase in inflation rate which been on the downward trend since midlast year.

Details of the gesture by gov’t emerged as Eamon Gilmore, the foreign affairs minister for the Republic of Ireland, announced on Monday that Uganda had reimbursed 14bn shillings in misappropriated Irish Aid funds.